General Approach:
1. Welcomes the Commission’s Green Paper and the opportunity to improve corporate governance structures throughout the EU;
2. Notes that during the recent financial crisis many financial institutions around the world failed at great cost to the taxpayer; believes that the Commission is right to examine every possible cause of failure in financial institutions in order to prevent another crisis occurring;
3. Notes the shortcomings of the prescriptive US Sarbanes-Oxley Act, which failed to protect US institutions during the financial crisis, whilst at the same time increasing compliance costs for all listed companies, in particular SMEs, reducing competitiveness and hampering the creation of new listed companies;
4 . Recognises that the area of corporate governance is constantly evolving and is therefore ill-suited to a prescriptive approach and that a flexible ‘comply or explain’ approach in the form of codes of best practice is more appropriate; believes that ‘comply or explain’ is proportionate and can be applied across a wide range of financial institutions operating in various sectors and markets, but that it must be complemented by regular external evaluation and appropriate regulatory oversight;
5. Calls on the Commission to submit every proposal it considers to improve corporate governance to a cost-benefit impact assessment which focuses on the need to keep financial institutions competitive so that they can help deliver economic growth.
Rapporteur: Ashley Fox (ECR, UK)
© European Parliament
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